Hospitals sue DHEC over Certificate of Need veto

COLUMBIA — South Carolina should reinstate a program that regulates whether new medical facilities can be built, hospitals can expand and doctors can buy expensive equipment, according to a lawsuit filed by hospitals and health care associations.

Groups including the South Carolina Hospital Association asked the state Supreme Court last week to force the Department of Health and Environmental Control to continue operating the Certificate of Need program, the absence of which constitutes an “imminent harm” to the public.

DHEC chief Catherine Templeton suspended the program in June after the Legislature did not override Gov. Nikki Haley’s veto of $1.7 million to run it. Haley has said she vetoed the funding because she thinks it’s an impediment to the free market and is no longer needed.

When DHEC halted the Certificate of Need program, according to the lawsuit, the agency had 32 open applications totaling $86.4 million in requests. Some of these projects are in Bluffton and Beaufort County.

Before Haley became governor, Lexington Medical Center, where she worked as a fundraiser, fought for nearly a decade to be allowed to do open-heart surgery. DHEC initially refused permission but relented after a compromise was reached with another Columbia-area hospital.

The House sustained Haley’s veto after Ways and Means Chairman Brian White took the floor and said the veto was just about the money, not whether the program should continue. Since that debate, House Republicans have subsequently said they did not intend to nix the program entirely, pointing out in a June 28 statement that an executive decision to discontinue the program “may be contrary to law but is certainly contrary to the will and intent of the House of Representatives.”

DHEC spokesman Mark Plowden said Friday the agency is reviewing the hospitals’ lawsuit. Anticipating such legal action, DHEC had already asked justices for an opinion on suspending the program, the details of which are spelled out in a state law that is still on the books.

It’s that law, the hospitals’ lawsuit argues, that means that neither Haley nor the Legislature — simply by upholding her veto — can simply unfund the program.

“That the CON Act has not been repealed demonstrates the General Assembly’s intent that it should remain the law of this State,” the hospitals argue.

The state Supreme Court has yet to say if it would agree to take up either lawsuit. In a statement, Haley spokesman Rob Godfrey said the issue should be settled by the Legislature’s decision not to override the governor’s veto.

“Legislators have long wrapped small amounts of funding for good programs around large amounts of money for bad to stop fiscally responsible governors from being able to budget thoughtfully,” Godfrey said. “But let’s be clear — the Legislature agreed with the governor by sustaining her veto, and state government has spoken with one voice: it’s time for us to move past a bureaucratic program that makes health care more expensive and harder to get for South Carolinians.”